Dip in private bond market issuance

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The country’s economy is generally projected to grow slower this year amid continued headwinds and global recessionary risks.

A key risk to watch out would be the softer macroeconomic conditions expected this year that may dampen the appetite for fundraising activities in the private bond market.

“Fundraising will be on the high side when market activities are booming. But, when the economy decelerates amid inflationary pressures, the private sector may not have a strong appetite for fundraising,” he said. “Although we expect growth to slow in 2023, it should return to a more stable and sustainable growth rate, reflecting a normal business and economic environment.

Commenting on the outlook of the PDS market, Maybank IBG Research said the issuances in the infrastructure and utility sector would be driven by ongoing rail projects, integrated utility players and pockets of renewable independent power producers.“Banks are well capitalised thus issuances may be driven largely by refinancing.

Amid the lower gross PDS issuances in 2023, Maybank IBG Research expects the demand for ringgit-denominated credit to improve, recovering from a jittery 2022.

 

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